I'd like to know how on god's green earth they did the 'valuation'. Because there are certainly no generally accepted ways of doing that - hence the volatility.<p>"Here are a set of numbers that you can own and rigorously control (i.e. establish ownership). You can possibly exchange them as value, like a currency, but not many people will do that. Start the bidding!"<p>It's the most pure form of speculation imaginable.<p>Most other forms of speculation are derived, yes, from what we think 'others' will pay, but what 'others' will pay is usually derived from some economic value: i.e. a home is a place to live, a building a place to work, shares are rights to future profits, bonds get 'repaid' and pay 'coupons' ... so you can try to figure out 'what they are worth'.<p>BTC ... it's literally just worth what some other guy will pay - and that's 100% of the story. That's a difficult thing to predict :)
I remember analysts and experts in 2004 sneering at the thought that Google might be worth $23 billion at the time of their IPO.<p>The pundits and talking heads gravely warned that investors were crazy to pay 230 times the prior year's net income.<p>They said Google was a "one-trick pony". They said Google could never grow into that insane valuation.<p>It was a bubble, they said.<p>Why didn't foolish speculators learn from the dot com crash, or from the Dutch tulip mania?<p>Maybe today's wise men are right, and the cryptocurrency bubble will burst in a spectacular bonfire of hubris.<p>Or maybe they aren't really wise. Maybe they only know what they know, and can't understand what's right in front of their faces, just like they couldn't understand what Google could become.
“During the information technology bubble, we saw a rally in dot-com company shares. But at least at that time, there were people using Yahoo or (Japanese internet firm) Rakuten -- people were using their services,” he said.<p>-> People ARE using Bitcoin's services, notably Venezuela now after the default. Argentinians have been using it to escape the terrible inflation that plagues their peso.<p>“But this time, I see quite a lot of people doing crypto-currency businesses in my circle of friends. But I hardly know anyone in person who is trading crypto-currencies and I haven’t seen anyone using them in real life,” he said.<p>Just because you are living in a bubble doesn't mean people don't use it. TenX's cards have been around for a while and they can be used quite seamlessly. i have also paid my friend for lunch using Bitcoin just to test it out. Heck there are even bitcoin atms in Japan. I think this speaks more about the quality of their leadership than about cryptos tbh.<p>That said, I am not claiming the currency will go up or down. As noted by some other users, the value is quite arbitrary, and like gold this is a market that is sentiment driven. But if he understood the theory and tech behind it, he wouldn't have made the $100 claim, really makes him look like a joke.
The price of bitcoin may be bubbly but the tech isn't. Most of the people buying in to bitcoin and crypto right now are chasing $ and are mostly driven by speculation instead of an understanding of the tech behind it and its potential.<p>Regardless if the price doubles in the next year or corrects 30% in a few days, there's a ton that's going on in the blockchain space (if you look past a lot of the get-rich-quick/scammy ICO companies). Payments, cross border transactions, IPFS, security, voting, etc are all things that are being or could be disrupted by the blockchain tech
"Sago said bitcoin’s rally could end after its price hits the $10,000 mark or <i>right before the CME Group launches bitcoin futures</i> some time by the end of this year."<p>Given the fact this happened yesterday:
<a href="https://www.bloomberg.com/news/articles/2017-11-15/bitcoin-exchange-that-cme-plans-to-use-for-futures-is-down" rel="nofollow">https://www.bloomberg.com/news/articles/2017-11-15/bitcoin-e...</a><p>It will be interesting to see how things pan out once the future contracts are released.